LeSupercar’s electric vehicle in China
LeSupercar, an affiliate of Leshi Internet Information & Technology, announced that it will start manufacturing electric vehicles in China, pursuing its ambition to shake up the auto industry dominated by traditional players.
China’s major video-streaming service provider is investing 20 billion yuan ($3 billion) to build its first auto output base, in Deqing in Zhejiang Province. Production is to start within two years, with an annual capacity of 400,000 units.
The newly unveiled plan is going to “bring a revolution and overturn the traditional auto industry consisting of Europe, the U.S., South Korea and Japan,” according to Jia Yueting, founder and CEO of Leshi, speaking at a press conference in Hangzhou. He also added the plan “will let the Chinese auto industry take the lead in the world automobile business.”
Under the agreement with the provincial government, the company is planning to create a 3-sq.-kilometer industrial park with a car manufacturing facility and exhibition of LeEco’s contents from other business divisions, such as music, movies and sports. Leshi vice president and co-founder Liu Hong told the Nikkei Asian Review on Wednesday that “construction will start as early as the end of this year.”
It was four months ago that Leshi, sometimes dubbed China’s Netflix, unveiled its all-electric-powered concept car, the LeSEE in Beijing. Jia then introduced the car with its planned features including self-driving and a facial recognition system, in addition to being connected online, as he stood next to it.
But it was more than those features that stirred the audiences. He took it further by telling the audience at the Beijing launch event in April that the car will be “free” in the future, adding that “99.9% of people think we are being a big mouth to get attention, but just like there are free smartphones, we will make it happen one day.”
The history of Leshi’s automobile business is rather short, dating back to February 2015, with bigger steps having been taken just recently. In February this year, the company partnered with British luxury car maker Aston Martin, known for creating James Bond’s cars, and California-based Faraday Future. Two months after that, the company boasted its autonomous driving research center co-established with Faraday Future, named LeFuture AI Institute in Silicon Valley. The company also has recruited talent from other Chinese automobile companies, including SAIC Motor and Guangqi Toyota Motor, a joint venture of Guangzhou Automobile Group and Toyota Motor.
Meanwhile, it is not only about its ambitious vision for automobiles. Its rapid expansion in diverse businesses — including video-streaming services, smart TVs, smartphones, virtual reality and now autos — has also grabbed the public’s attention.
According to Jia, this all makes sense, as the businesses “pretty much cover all walks of daily life.” Automobiles are an addition to his grand design, where he is “full of expectations.” However, he did not say where all the money is coming from, but a company executive told the Nikkei Asian Review that the information “is confidential.”
The company also stirred concern in the investor community when it suddenly decided to suspend trading in its Shenzhen-listed stock last December, only to resume in June. In trading on Wednesday, which took place before the announcement of the vehicle facility, the shares closed at 45.87 yuan, down 1.2%. This is 22% lower than the level prior to the suspension last December.